Murray Energy term loan agent objects to stalking horse credit bid

By Caroline Salls

Pittsburgh, Jan. 2 – Murray Energy Holdings Co. term loan agent Black Diamond Commercial Finance, LLC objected to the company’s request to enter into a stalking horse agreement for the sale of substantially all of its assets, according to a Thursday filing with the U.S. Bankruptcy Court for the Southern District of Ohio.

Black Diamond said the stalking horse agreement calls for a credit bid of specified debt held by a group of super-priority term lenders.

However, the agent said it filed a complaint on Nov. 20 that is an objection to the allowance of the super-priority term lenders’ claims and that “creates a bona fide dispute as to the validity and priority of the liens held by the super-priority lenders.”

For this reason, Black Diamond said the court should deny the lenders’ right to credit bid their debt.

The agent said it proposed changes to the motion under which the lenders would establish a cash reserve in an amount equal to the obligations due under the term loan agreement.

“Despite the agent’s attempt to compromise, the super-priority term lenders have informed the agent that they will not agree to the revisions to the bidding procedures and bidding procedures order proposed by the agent,” the objection said.

Murray Energy is a Saint Clairsville, Ohio, coal company. The company filed bankruptcy on Oct. 29 under Chapter 11 case number 19-56885.

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